U.S. oil imports from Saudi Arabia dropped below 1 million barrels a day in the first 11 months of last year, while China’s imports of Saudi oil exceeded that level.
Who would have guessed 30 years ago that China would become dependent on Mideast oil while the U.S. eased that dependence?
The U.S. has cut energy consumption and increased imports from Canada and Africa to lessen its need for Saudi crude, the Financial Times reports.
China’s rising demand for Saudi oil reflects its exploding economic growth of course.
The amount of oil China buys from Saudi Arabia has doubled since 2006.
From the Saudi point of view, “China offers demand security, something that for a long time the oil-producing countries including Saudi Arabia have called for,” John Sfakianakis, chief economist at Banque Saudi Fransi, tells the Financial Times.
“As global demand has been picking up in the east, . . . Saudi Arabia has been looking east.”
The Saudis are cementing ties with China through joint refinery ventures.
As for the U.S., while its imports from Saudi Arabia hit a 21-year low of 998,000 barrels per day in the first 11 months of last year, that’s still enough to keep the country dependent on Mideast oil.
Wherever the demand is coming from, oil has risen in recent days, approaching $80 a barrel.
"I think investors are pretty much looking at all the usual suspects," energy economist Jim Williams told CNNMoney.com to explain the rise.
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